An employee showcases a semiconductor integrated circuit at an industry expo on October 31, 2018. File Photo: VCG

A Chinese lawmaker has suggested a 100-billion yuan fund to promote China's integrated circuit industry, launch innovative pilot programs, and international cooperation in Shanghai. 

National People's Congress (NPC) deputy Chen Mingbo proposed the fund and also lowering special interest rates to spur domestic integrated circuit industry growth on Friday.

The proposal follows US sanctions on 33 Chinese companies and institutions on Friday, a move aimed at imposing technology blockage against Chinese companies.

The sanctions will restrict sales of US goods shipped to those companies which focus on artificial intelligence and facial recognition technology.

In the long term, the US' technology blockage provides an opportunity for China to accelerate domestic chip development, Xiang Ligang, director-general of telecoms industry association Information Consumption Alliance, told the Global Times.

"The US technology blockade is a good thing in the long run, as they have given away the market to Chinese chip-making companies," Xiang said.

The US leads in the entire chip industrial capacity in brand and comprehensive strength, Xiang explained, adding that when the technical blockade forces Chinese downstream manufacturers to use products developed domestically, this would help Chinese companies grow stronger.

"Chinese chip industries lack nothing but time and orders. I expect there will be a breakthrough in 3-5 years, maybe even sooner," Xiang said.

Other than the integrated circuit industry, Chen, who has been working with Shanghai's economy and information departments, also suggested the country should increase scientific and technological innovation in Shanghai with more pilot programs to adapt to new technologies and products.

For example, Xiang suggested the country modify traffic regulations and allow Shanghai to test driverless vehicles on open roads while exploring how traffic violations should be handled. 

Chen also called upon the city to carry out more international innovation cooperation at the Lingang New Area inside the Shanghai Free Trade Zone, to support and promote more innovation initiatives.